My Interview with John Ling, CEO of MacKenzie-Childs
At my recent visit to NetSuiteWorld in Las Vegas, I interviewed John Ling, the CEO of home décor brand MacKenzie-Childs, about how entrepreneurs can best prepare to sell their companies.
At my recent visit to NetSuiteWorld in Las Vegas, I interviewed John Ling, the CEO of home decor brand MacKenzie-Childs Ltd. The company is a popular manufacturer of ceramics and retailer of hand-painted imported furniture and home décor, based in Aurora, New York.
In our conversation, Ling discusses his background and how he became CEO. He also talks about the implementation of NetSuite MacKenzie-Childs and how it has helped improve business processes as well as helped teams access real-time data.
Ling emphasizes the importance of discipline and process in preparing a company for possible sales or investments. He advises entrepreneurs to have a plan and a vision for the future of their business and to involve the right people along the way. He also highlights the significance of thorough planning and preparation when implementing systems like NetSuite.
The following is my interview with John Ling, of MacKenzie-Childs.
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John Boitnott:
Hi John! Tell me a little about your history. How did you eventually become CEO in 2015 of MacKenzie Childs?
John Ling, MacKenzie-Childs:
Sure. My undergrad degrees were in Engineering Computer Sciences. I went into manufacturing with PepsiCo and FritoLay. Did that for about 10 years, got my MBA in finance at SMU, and I was down in Dallas with FritoLay, and then subsequently worked for Medco and then Merck in an engineering role for healthcare fulfillment. And then I joined Crate and Barrel, which is when I got into retail when they were about a $200 million company. Stayed there for 15 years until they were $2 billion.
So the first two thirds of my career were in multi-billion dollar companies. I was very fortunate to work in a wide range of organization types and pretty much do every job there is to do in a corporate structure. So I really like to think that I've got a deep toolkit from problem solving and improving businesses and believe in doing it through people and enablement and so forth.
When I left Crate and Barrel, I ended up going to an opportunity that was for the role, but it coincidentally was a Blackstone-owned company. And after I sold that, I became really interested in this mid-market space, these smaller companies, being an engineer and still loving to get my hands dirty after a private equity firm buys a company, I get hired as the CEO to build it, professionalize and create value, then hopefully make a transaction that creates some value for everybody and I've just fallen in love with it. So that's what I do now.
John Boitnott:
That's great. Well, we’re here at NetSuite, NetSuite world and your company uses NetSuite, tell me how it uses it to the extent that feels appropriate and what are the reasons why - and how has it helped?
John Ling, MacKenzie-Childs:
Yep. So I've been there eight years and we implemented in 2018, so we're going on five years. When I go into these companies, an Employee Resource Management (ERP) transformation is almost one of the things I always look at if they haven't recently done that. And it's both for the access to data, the enablement of technology, but frankly, it's just as much about evolving a culture.
McKenzie-Childs was a great example of a smaller company that had done pretty well by itself, but it was mostly paper and pencil. They had a couple of old ERP type systems and I knew this was something we had to do to create a platform to really scale the business, which is what my challenge was. And, got things settled, got the basics of the business down, and then embarked on an ERP project.
I got to know the organization and picked the best eight most talented people in the organization to create a core team — because I really believe in dividing the business requirements first. Every software package out there looks great. When the salesperson's talking to you, it's really about what it can do for your business. And you always make sure you define the business requirements that your business needs before you start looking at all the shiny stuff out there.
And we did that. The core team did it. It really enabled me to identify their talent, let them be involved in the future of the business, identify the people that are going to wrap their arms around this, and that's really where the culture change takes place.
So I oversaw the team. Six of the eight members are still with the company five years later, which is a pretty good track record too. Sometimes they don't survive that evolution. And we chose NetSuite over them at Microsoft Dynamics. We figured it was a better fit for us and primarily focused on the data access business, financial side of it. Went with their RF smart partner for the WMS side of it, but really elevated the entire business, gave us real time access to the business, made everybody smarter, gave people a lot of tools to answer the tough questions I was asking about what people are up to, what they're working on, what the priority is.
It really made the whole company more technologically oriented. People think that way now, and it really just elevates the culture and it's been a great journey for us. And we've added a couple modules along the way as we've gone, and it is an integral part of how we manage the business now.
We used to talk sales and results on a weekly, sometimes monthly standpoint now. We talk about it daily, if not hourly, got everything at our fingertips, know what customers are doing, what channels are doing. It has really made a positive change in the business.
I've done six ERPs in my career, three of 'em with big companies, three of 'em with small companies. So I've got a lot of experience at it, and it's something I really believe in that small businesses can do to really enable their and their businesses. And NetSuite's great because it's scalable. It doesn't cost millions of dollars to get on it. It's good for small companies. It's a good place to start.
Frankly, if a founder or a second generation group is trying to make their company better and market their company, having an ERP in place and having those disciplines in place can make a huge difference in how the exterior investment community views that company besides just the pure performance.
John Boitnott:
Got it. Yeah. So this is obviously a big thing that founders and smaller companies can do to bring their company up to date as they prepare for a possible sale?
So what are some other things that they can do in that area? You’re clearly a subject matter expert on this, bringing a company up to snuff in order to possibly get bought at some point.
John Ling, MacKenzie-Childs:
I would call it discipline, how do you create discipline around process in your business? You don't have to go with the biggest and the best, but take a look at your business, think about what makes it strong, identify those important processes and the people that are around them and add discipline to the process.
When somebody looks at a company that they want to invest in or acquire, they look to see whether the team has their act together or not. It's really as simple as that. Are they working on the important things? And if the answer is yes, that allows them to take the next step.
It's interesting because a company that's looking to be sold can't be too far behind the evolution curve, and they can't be too long into it because when an investor looks at a company, they want to make sure that the basics are there, the foundation is there. There's people in the business that know what they're doing, so they don't have to transform the culture, but they also want to know there's opportunity down the road that they can make a difference at.
So it's adding that discipline on the important processes in the business, and then it's picking the right time to sell based on the evolution of your company. Obviously that's impacted by their macroeconomic conditions at that time, but it's important to be in a solid place, to be in a place where you could scale the business, but also have new opportunities for the business looking forward.
John Boitnott:
Is there anything else that you'd want to add in relation to that? What entrepreneurs can do to sort of prepare to sell their business or look at that on the horizon? Just general advice about that.
John Ling, MacKenzie-Childs:
I would say in addition to what I said is have a plan. Know what your future looks like. One of the first, if a founder stays with a company, one of the first things they'll be asked to do is give me a three-year plan or a five-year plan.
You should have one of those ready when you go to sell your company. An investment bank can of course help you make a plan for that. But having a founder that is thinking ahead and knows where their business is going and is putting the building blocks in to get there is critical for an investor. They want to know that there's a way and a path towards creating value. And a lot of entrepreneurs don't do that.
They kind of manage in the time they're managing all the variables that are going on with their company. If they start thinking a little bit bigger, what are my goals? What's my vision? Where do I want to take it? It's something that the investor could potentially come in and really think about, how am I going to help him or get there.
John Boitnott:
Yeah, that's even something when you're just looking to raise around.
John Ling, MacKenzie-Childs:
Exactly. Have a plan. Have a plan, and know where you're going. That's what they want to know because the value's going to come from the future creation. It's not going to come what the company is right now. They already know what it is right now. They want to know where it's going to go,
John Boitnott:
And they want to see that you're really competent.
John Ling, MacKenzie-Childs:
Exactly. To get it there. The first point is to think about it though. The second thing is to have a plan to get there and then have many of the parts, but not all of them, to get where you want to go. Because an investor wants to know to come in that they can be complimentary and make a difference. They typically don't want to just stand on the sideline and watch what happens. They want to be a part of it.
John Boitnott:
Alright, this has been great. Is there anything else you feel like you've missed you would like to add about any of the subjects that we've covered?
John Ling, MacKenzie-Childs:
I would just say when you're looking at something like NetSuite, 90% of your efforts should go into planning. Then 10% of the results will be great. Don't put 10% into the planning and expect the results to be great. There's a lot of heavy lifting that has to be done early on; Doing the business requirements, picking the right system, making sure it’s right for you, making sure your culture is ready for it, involve the team in that process, and then go ahead and launch a product.
It's all about the planning and the preparation and the results will follow by themselves. So just take your time at the beginning. Don't put these things in half-heartedly, do it the right way, involve the best people in your company and put a plan together and then launch.
John Boitnott:
Perfect. Thank you, John.
John Boitnott is a journalist and digital consultant who has worked at media companies for 25 years. He writes about startups, marketing and leadership at Entrepreneur, the Motley Fool, Readwrite.com, Jotform.com, and his blog.